Zoopla published the rental market report on 14 September 2023. This gives a comprehensive overview of the current trends in the rental sector. We have pulled out some key facts that interest landlords and property investors.
Over the past few months, there has been a decrease in the demand for properties. However, the demand compared to 5 years ago is still very high. There still needs to be more properties available to meet the demand across the UK. The current state of the housing market has impacted rental demand. In some cases, people choose to rent instead of buy due to high property prices and uncertainty in the housing market.
Several other factors are contributing to the high levels of demand over summer:
The graph below shows the supply and demand over the past year.
(Source: Donnell, R (2023) Rental Market Report: September 2023)
The continued increase in demand has increased rental growth. Figures show that average rents have grown by £110 per month over the last year – an annual rise of £1,320. In September 2022, rent controls were introduced to help existing tenants. So, all existing tenancies were capped at a 3% yearly increase. However, as properties become vacant, landlords can reset the rent to reflect the market rate.
The outlook is that rents for new lettings are expected to keep rising ahead of earnings growth in 2024, projected to be 3.6%, in the face of ongoing supply constraints and sustained higher mortgage rates.
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Haidee is our Personal Tax Director and is a fully qualified tax adviser, having achieved the ATT qualification in 2006. Tax efficiency being her main concern. Specialising in taxation, Haidee provides clients with advice on personal tax, PAYE services, VAT and social security. She also provides guidance to new start-up businesses.
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